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Affirmative Action, Incentives and the Black-White Test Score Gap

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  • Eric Furstenberg

    () (Department of Economics, College of William and Mary)

Abstract

This paper develops a theoretical model of college admissions to study the effects of affirmative action policies on the high school achievement of college bound students. The innovation is to include endogenous human capital decisions in the model. When colleges switch admissions policies, they implicitly alter the likelihood of acceptance earned by a given human capital investment. Thus, human capital investments are sensitive to changes in admissions policies. The main results are that banning affirmative action increases the black-white test score gap and decreases college enrollment and social welfare of the minority group.

Suggested Citation

  • Eric Furstenberg, 2004. "Affirmative Action, Incentives and the Black-White Test Score Gap," Working Papers 03, Department of Economics, College of William and Mary.
  • Handle: RePEc:cwm:wpaper:3
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    File URL: http://economics.wm.edu/wp/cwm_wp3.pdf
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    References listed on IDEAS

    as
    1. Haim Levy, 1992. "Stochastic Dominance and Expected Utility: Survey and Analysis," Management Science, INFORMS, vol. 38(4), pages 555-593, April.
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    More about this item

    Keywords

    Affirmative Action; Discrimination; Public Policy; Education; Asymmetric Information;

    JEL classification:

    • I20 - Health, Education, and Welfare - - Education - - - General
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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